Apple gains on upgrade; BlackBerry rallies

SaumyaVaishampayan

SAN FRANCISCO (MarketWatch) — Apple Inc. extended gains to a fourth session in the wake of an analyst upgrade on Monday while BlackBerry Ltd. got a lift from a report that it may have several high-profile suitors, including Cisco Systems Inc.

Top Tickers Trending

$AAPL: Apple
AAPL, +0.42%
shares rose 1%, among the top gainers in the S&P 500
SPX, +0.64%
The stock was raised to a buy rating from hold on Monday by Jefferies, which also raised its price target to $600 from $425. The move came after Jefferies analysts met with Apple’s suppliers in Asia, who have become “far more lenient on price,” which will lift gross margins. Analyst Peter Misek also said Apple’s price is likely to appreciate ahead of the iPhone 6 launch.

$BA: Boeing Co.
BA, +0.23%
fell 0.4% as Japan Airlines
9201, +1.44%
signaled the end of its exclusive partnership with the U.S. airplane manufacturer by placing its first-ever order with European Aeronautic Defence & Space Co.’s Airbus for 31 long-haul jets worth more than $9 billion. Deliveries will begin in 2019. Executives at Japan Airlines had openly questioned the flagship carrier’s business relationship with Boeing in the wake of the grounding of one of its 787 Dreamliners earlier this year due to problems with lithium-ion batteries.

Bloomberg

An American Airlines Boeing Co. 737-800 plane.

$IBM: Shares of International Business Machines Corp.
IBM, +0.46%
retreated 1.1%. The stock was lowered to equal-weight from overweight at Barclays on Monday. Analyst Ben Reitzes also cut his price target on the stock to $190 from $215.

$FB: Facebook Inc.
FB, +0.59%
shares slid 1% after an analyst at Raymond James lowered the stock to strong buy from outperform but then raised its target price to $56 from $38. Analyst Aaron Kessler said he maintains a positive bias on Facebook but downgraded the stock given about 10% upside potential from the new price target. “We maintain our positive fundamental view on Facebook and expect 3Q upside driven by strong traction with mobile advertising (estimate 23% quarter-on-quarter growth) as well as newer ad formats,” said Kessler in a report. He also added that investor sentiment and expectations ahead of the third quarter were much more positive compared to sentiment leading up to the second quarter.

Gainers

BlackBerry
US:BBRY
shares advanced 3.6%. The stock was boosted after a late Friday report from Reuters that said BlackBerry had reached out to potential buyers, including Cisco
CSCO, +0.57%
Google Inc.
GOOG, +0.57%
and SAP AG
SAP, +0.06%
as part of its sales process. Last month, the smartphone maker reached a preliminary deal with Fairfax Financial Holdings Ltd. to go private for $4.7 billion.

If Cisco indeed is a serious contender to buy BlackBerry, it is expected to make an offer just for its software rather than its handset business, James Moorman, an analyst at S&P Capital IQ, said in a note.

In contrast to Boeing, shares of rival defense contractors were among the best S&P 500 performers, buoyed in part by the Pentagon’s decision to recall most of its civilian workers who were furloughed by the government shutdown. Northrop Grumman Corp.
NOC, +0.63%
rose 1.8%, Raytheon Co.
RTN, +0.74%
climbed 1.3% and Lockheed Martin Corp.
LMT, +1.58%
rose 0.9%.

Intuitive Surgical Inc.
ISRG, +1.66%
shares gained 4.6%. Analysts at J.P. Morgan said they remain “constructive” on longer-term potential for Intuitive Surgical’s da Vinci surgical system despite headwinds in the past few months. Da Vinci “has evolved from being a tool with limited uptake in the surgical suite to a diversified platform, with increasingly broad applicability in areas such as colorectal, bariatric, thoracic and vascular surgery,” Tycho Peterson, an analyst at J.P. Morgan, wrote in his report.

HCP Inc.
HCP, +0.88%
shares rose 2.1% after three days of losses. Analysts had expressed concerns over the abrupt dismissal of Chairman and Chief Executive James Flaherty last week.

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